NBC Gets Olympic TV Rights for $300 Million

The American television rights to the 1988 Seoul Olympic Games were awarded to NBC Thursday for a minimum payment of $300 million. NBC will pay more if the network’s advertising receipts rise above a specified figure that was not announced.

The award to NBC broke ABC’s recent stranglehold on Olympic television coverage and also, in effect, ended the escalation of payments for Olympic TV rights. For the first time, the minimum payment for rights to the Summer Games is smaller than the payment for the rights to the Winter Olympics. ABC has a $309-million contract to show the 1988 Winter Games at Calgary, Canada.

According to a formula reached in New York by negotiators for NBC, the International Olympic Committee and the Seoul organizers, the South Koreans could make as much as $500 million. But those involved in the negotiations said that no one expects that figure to be reached.

The upper limit saves face for the South Koreans, who originally had hoped to get more than $700 million for the American rights and as recently as three weeks ago insisted on a minimum of $550 million. While the South Koreans held firm, however, the advertising sales market for the Olympics was going soft, and NBC’s bid this week was actually $25 million below the $325 million minimum it had offered last month.

The two other networks, CBS and ABC, were well below NBC, as they had been in the earlier negotiations.

Seoul agent Barry Frank and IOC negotiator Richard Pound both said Thursday night that, realistically, the eventual NBC payments to Seoul should exceed $325 million and that Seoul had not lost ground by holding out.

Neither side would release key details of the deal--such as the percentage Seoul will get of any advertising receipts above the specified figure.

That reticence strongly indicated that the return to the Seoul organizers will be considerably smaller than they had expected.

“The bottom line is we’ll pay less for Seoul than ABC will pay for Calgary, yet we’ll have twice as many hours,” one NBC executive said.

The International Olympic Committee, however, came out of the negotiations in a very happy situation. In the split of television revenues with the Los Angeles Olympic Organizing Committee in 1984, the IOC got slightly more than one-third of 40% of ABC’s $225-million payment, or about $34 million.

Under terms of Thursday’s deal, Pound said, the IOC will receive one-third of 80% of what Seoul gets--a minimum of $80 million, more than double its take from Los Angeles. That reflects the fact that the IOC had more control over the negotiations this time than it did in the Los Angeles case.

Such results are expected to fuel what is reported to be strong feeling on the part of the Seoul organizers that they are being treated as poor relations. On the other hand, Pound and other IOC officials have expressed impatience with Seoul for holding out too long for what the IOC regarded as unrealistic figures.

Arthur Watson, NBC’s president of sports, said Thursday that the network plans 180 hours of coverage during the 16 days of the Seoul Games. He estimated that 80% of that time will include live coverage. The Seoul Games have been arranged to allow for many final events in the morning. With time changes, morning in Seoul is prime evening viewing time in the United States.

The Seoul Games will be held from Sept. 17 through Oct. 2, 1988, bumping up against both the professional football and baseball seasons in the United States. Watson said, however, that the network would continue its contracted coverage of major league baseball and the National Football League. “It will be a very busy time for us,” he said.

ABC did not seem too unhappy at losing out to NBC.

“Because the time difference between Seoul and the United States greatly reduces the degree of live coverage in prime time, ABC feels strongly that the Calgary Games are a more valuable network property,” the network said in an unsigned statement. “ABC certainly would have welcomed the opportunity to televise the Summer Games, but offering more than we did would have been imprudent.”

ABC’s reported bid of $225 million to Seoul--no more than it paid to Los Angeles--was regarded by the South Koreans as insultingly low.

Neal Pilson, CBS executive vice president who has talked for several years about sports rights payments in general having gone too high, hailed Thursday’s agreement as a watershed. From now on, he predicted, network bidding for all sporting events is likely to be at far more realistic--in other words, lower--levels.

Pilson said that CBS was unwilling to attend the final discussions Thursday because it does not believe in the kind of potential revenue-sharing arrangement entered into by NBC and Seoul. It creates a dangerous precedent for the industry, he said.

NBC’s deal also includes radio rights. ABC paid an additional $1 million for radio rights to the 1984 Summer Olympics in Los Angeles.

Times staff writer Larry Stewart contributed to this story.